It isn’t the program that many had hoped for, however many are cheering the latest development in Germany’s adult-use cannabis legalization.
After what was described as intense negotiations, the European nation’s legislative body hammered out a bill that expanded medical cannabis sales, decriminalized certain amounts of cannabis, and improved home cultivation restrictions.
Acting chairwoman of the health committee in the Bundestag, Kirsten Kappert-Gonther, said on the social media platform X that the bill would:
Reduce consumption bans to “sight distance” of schools and child care centers, with a minimum 100 meters.
Permit home cultivation of 50 grams of dried cannabis.
Amend the Driving Licence Ordinance with an appropriate limit by spring 2024.
The bill also proposes no mandated distances between cannabis clubs and no criminal penalties (only misdemeanors) for small quantities of 25-30 grams in public and 50-60 grams in private.
According to ZDFHeute, which added more detail, the bill provides for the removal of cannabis from the list of prohibited substances in the Narcotics Act and a maximum of three plants should be allowed to be grown in a private residence. In cannabis clubs, members would be allowed to grow the drug together and give it to each other.
This latest step forward likely has several Canadian cannabis firms cheering, as many have targeted the market for expansion as Canadian sales slowed.
According to Statista, the German medical cannabis market is anticipated to reach $333 million this year. Moreover, the market is expected to display a steady compound annual growth rate of 13.97%, resulting in sales of $640 million by 2028.
The companies that stand to gain the most from this legislative easing are:
Tilray (Nasdaq: TLRY) (TSX: TLRY): Tilray has two locations in Germany and works closely with doctors and pharmacists there. Tilray offers a broad portfolio of full-spectrum cannabis extracts and cannabis flowers in Germany.
Curaleaf (CSE: CURA) (OTCQX: CURLF): In 2022, Curaleaf Holdings Inc. announced that its European holding company, Curaleaf International Holdings Limited, signed a definitive agreement to acquire a 55% stake in Four 20 Pharma GmbH, a fully EU-GMP and GDP licensed German producer and distributor of medical cannabis with its own product line. The partnership creates a strategic pathway for Curaleaf to acquire complete control of Four 20 Pharma within two years of the commencement of adult-use sales in Germany.
Cronos Group (NASDAQ: CRON) (TSX: CRON): In September, the company sent its first order of cannabis to its German distribution partner, Cansativa, which is bringing the Peace Naturals brand back to the German market. The company said that re-establishing Cronos and the Peace Naturals brand in the German market would position it to capitalize on this growing opportunity with additional upside potential from future legislative changes, including in the rescheduling of cannabis to no longer label it as a narcotic.
Organigram (NASDAQ: OGI) (TSX: OGI): In May 2023, Organigram entered into a supply agreement for dried flower with the medical division of German cannabis company Sanity Group, a health and life sciences company based in Berlin,.
Aurora Cannabis (NASDAQ: ACB) (TSX: ACB): In April 2023, Aurora Cannabis announced the expansion of its portfolio in Germany with the launch of two new cannabis flower products for patients. In 2022, the company claimed to be the market leader in Germany. In 2019, Aurora was awarded a tender/contract by the German Federal Institute for Drugs and Medical Devices for the annual production of 1,000 kilograms of high-quality medical cannabis flower over a period of four years.
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